AN intriguing “tri-rainbow” coalition is being mooted by some Welsh Labour strategists, we can reveal.

Such an alliance would involve the Liberal Democrats joining Labour and Plaid Cymru in an enlarged left-of-centre Assembly Government after Rhodri Morgan steps down as First Minister.

Although the leadership of both Labour and Plaid Cymru dismissed the idea last night, well- placed sources within Welsh Labour insisted the prospect was a runner, either when Mr Morgan departs or after the next Assembly election in 2011. The suggestion has also been welcomed by the Welsh Liberal Democrats.

One Labour strategist told the Western Mail: “This could happen whoever wins the Welsh Labour leadership election later in the year – Carwyn Jones, Huw Lewis or Edwina Hart.

“On one level it would strengthen the Assembly Government as a broad-based left-of- centre administration with widespread public support. At a time when there is likely to be an incoming Tory Government at Westminster, it would also isolate the Tories as a relatively small opposition group at the Assembly.

“It would be easy to bring the Liberal Democrats in, with possibly two ministerial positions. Plaid Cymru would not have to lose any of its places because there are already three Labour Cabinet ministers who have indicated they will be leaving at the next election – Rhodri himself, Jane Davidson and Brian Gibbons. On top of that, Jane Hutt is almost certain to lose her Vale of Glamorgan seat to the Tories.”

Another Welsh Labour strategist said: “There would be another advantage in bringing the Liberal Democrats in. Three of the four Plaid ministers are doing a good job: Elin Jones is doing very well with Rural Affairs, it is generally agreed, Alun Ffred Jones is doing OK as Heritage Minister, and Jocelyn Davies is fine as Deputy Housing Minister.

“The one Plaid minister who is not doing well is Ieuan Wyn Jones, the party leader, at Economy and Transport. Many people take the view that he is being run by the civil servants. [Welsh Liberal Democrat leader] Kirsty Williams could come into the Cabinet as Economy Minister, with Ieuan becoming Minister for Social Justice. So far as the Liberal Democrats are concerned, there could also be a place for Jenny Randerson or Peter Black.”

A spokesman for the Welsh Liberal Democrats said: “We are hearing similar things from within Labour, although no direct approach has been made to us.

“It’s the type of progressive solution that could be very good for Wales.

“Bringing us into government would make the coalition broader and would help dispel the negative view of some people that coalitions are more to do with stitch-ups and deals than they are about running the country.

“It’s very difficult for us to comment in detail when no formal proposal is on the table, but it is certainly something we would consider very carefully if it was put to us.”

Speaking as the leader of the Labour Party in Wales, Rhodri Morgan said: “The One Wales agreement is a four-year programme of government and no such change to the present arrangement is in our thoughts.”

A Plaid Cymru spokesman said: “This is fantasy politics by those who resent the fact that Plaid’s record in Government has been so widely praised, particularly in terms of Ieuan Wyn Jones’ handling of the impact of the recession.

“Plaid has kept to its promise of delivering for communities across the whole of Wales – saving local hospital services, creating new affordable housing and investing in early years education.

“The One Wales programme of government is a four-year agreement endorsed by the members of Plaid Cymru and the Labour Party. Both parties are signed up to delivering that agreement together and there’s no question of the governance arrangements of One Wales changing before 2011.

“The Liberal Democrats had two opportunities to be a party of government in 2007 – with Plaid and Labour – and decided that they weren’t willing to shoulder the responsibility.”

A senior Plaid source said: “There are some in the Labour Party who are out to undermine the Labour-Plaid agreement and are trying to damage Ieuan for their own ends, helped by the Liberal Democrats.

“That is grossly unfair on him. Many organisations like the CBI and the TUC take the view that the Assembly Government’s way of handling the economic crisis has been good. We had static unemployment figures in the last quarter and, because of the Pro-Act scheme [which helps employers keep workers on during the recession], 4,000 workers are not on the dole when they otherwise would have been. There is a lot for us to be proud of, but I suspect we will have more of this kind of speculation in the coming months.”